Our view: Leading from the middle on pension reform

By The Northwest Herald Editorial Board

It’s mid-December and we still have no meaningful pension reform package proposed by leadership in Springfield. Since House Speaker Mike Madigan, and to a lesser extent Gov. Pat Quinn, are in charge, that could be a blessing in disguise.

It’s also a disgrace, as the pension deficit grows each day. Now it’s somewhere in the neighborhood of $94 billion. The deficit growth would make a Powerball jackpot winner blush while Quinn and Democratic leaders fiddle.

Last week, it took a group of about two dozen rank-and-file members of the General Assembly to get some kind of proposal on the table to deal with the crippling financial crisis. While there may be flaws in the proposal, at least they aren’t sitting idly by, waiting for legislative leadership to guide them.

While Democrats have super-majorities in both state houses, not all Democrats have the same constituents. Not all problems in the suburbs are equal in rural counties or in Chicago.

Many downstate representatives and suburban GOP legislators have similar issues with pension reform proposals that rely heavily on shifting the pension burden from the state to local school districts that suburban GOP legislators have.

Besides shifting the burden to local taxing bodies, last week’s proposal brings up needed reforms, such as reducing the cost of living adjustments for retirees, raising retirement ages, and requiring greater employee contributions to the pension systems.

McHenry County lawmakers say the burden shift is a deal killer, but we can’t afford to be so dismissive now. Perhaps a gradual shift is something that would satisfy the varied interests.

There also are concerns about whether cutting COLA increases would survive court challenges since the state Constitution contains language that pension benefits “shall not be diminished or impaired.”

While it’s responsible for legislators to be certain that they aren’t approving bad laws, some drastic measures need to be taken. Short of doing nothing, it might be worth a court challenge to write a better law. Voters might even be willing to change the Constitution.

All ideas should be on the table. What about taxing pension benefits? Taxpayers paid for the salaries all along, why is it so unreasonable that pension recipients pay taxes on their benefits like anyone else?

No one is going to like every part of a package that gets the state out of a $94 billion hole – neither taxpayers nor pension recipients.

But if the General Assembly can figure out a way to cram an unpopular 67 percent income tax increase down our throats during a lame duck session, surely it can pass pension reform.